Common stock-market and preferred stock

Assignment Help Financial Management

Reference no: EM13940276

You are given the following information for Lightning Power Co. Assume the company’s tax rate is 30 percent.

Debt: 6,000 7.9 percent coupon bonds outstanding, $1,000 par value, 25 years to maturity, selling for 108 percent of par; the bonds make semiannual payments.

Common stock: 510,000 shares outstanding, selling for $69 per share; the beta is 1.12.

Preferred stock: 29,000 shares of 4 percent preferred stock outstanding, currently selling for $89 per share.

Market: 10 percent market risk premium and 5.90 percent risk-free rate.

What is the company's WACC? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))

WACC %

Reference no: EM13940276

Questions Cloud

What is the expected price of the stock in a year : What is the expected price of the stock in a year? Show that the expected return, 12%, equals dividend yield plus capital appreciation.

Appropriate template of a project plan online : Find an appropriate template of a project plan online. Use the template to write a plan for your project. Prepare a 30 minute PowerPoint presentation of the plan and submit it to your lecturer

What do you feel is the role of law enforcement in community : What do you feel is the role of law enforcement in the community? Does this role change over time, or should it be stable?

Large organisation that of a service nature : Large organisation that are of a service nature such as banks and hospitals used to be noted for their lack of standard costing systems and their relatively unsophisticated budgeting and control systems compared with large manufacturing organisati..

Common stock-market and preferred stock : You are given the following information for Lightning Power Co. Assume the company’s tax rate is 30 percent. Debt: 6,000 7.9 percent coupon bonds outstanding, $1,000 par value, 25 years to maturity, selling for 108 percent of par; the bonds make semi..

Duties and obligation that are inherent in undertaking roles : This assessment task is designed to assist students to explore their own understanding of what it means to be a professional manager and leader and the duties and obligations that are inherent in undertaking such roles.

What are your thoughts on gun intervention strategies : What are your thoughts on gun intervention strategies and why they frequently lead to claims that law enforcement has targeted the minority community? What do you think can be done to mitigate such concerns?

What is project management : What is Project Management? Develop Project charter. Develop Project Management Plan

Capital structure weights on a book value basis : Erna Corp. has 9 million shares of common stock outstanding. The current share price is $81, and the book value per share is $8. Erna Corp. also has two bond issues outstanding. What are Erna’s capital structure weights on a book value basis?

User Account

All Pages